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Important update on EU tariffs on boats imported from the US

Published on: 28 June 2018

USA sailing flag

Update Published 29 June 2018

British Marine member, Peters & May (a leading global logistics company), has published a helpful FAQ from its customs specialist, Simon Beck, on the application of the tariffs. Visit Peters & May FAQs.

Update Published 28 June 2018

British Marine has written to the EU Commission to express the UK leisure marine industry's concerns about the ongoing trade dispute with the USA. Read British Marine's letter.

The International Council of Marine Industry Associations (ICOMIA) and the European Boating Industry (EBI) have also written a joint letter to the EU Commission, highlighting the concerns of the global marine industry and calling for immediate de-escalation of the dispute on both sides of the Atlantic. Read ICOMIA/EBI joint letter.

British Marine has been made aware of some online information stating that outboard powered craft imported from the US are excluded from the new tariff measures. This is inaccurate and members should be aware that all pleasure craft imported from the US (unless they were in transit prior to last Friday's implementation date) are subject to the newly imposed 25% import tariff.

Update 2 Published 22 June 2018

Following the efforts of British Marine, supported by its member Peters & May, British Marine can confirm the following update from HMRC regarding the importation of boats from the US which were in transit prior to the new tariffs:

For goods exported from the US prior to the date that the duties legally came into force, you can use override code VCL against the A20 tax line (please see Tariff Volume 3 Part 3 page 3-18 for override codes).

Evidence of this may be required at a later date.

British Marine expects the advice and guidance on the GOV.UK website to be amended in due course.

Update Published 22 June 2018

The UK Government has published its update on the EU tariffs: https://www.gov.uk/government/news/eu-measures-in-response-to-us-steel-and-aluminium-tariffs

In response to concerns raised by member companies, British Marine is in contact with the Department for International Trade and HMRC, to seek urgent clarity on the processes involved with goods that were already in transit prior to the new tariffs being implemented. HMRC has suggested that the higher rate will be paid on all imports and importers will need to reclaim the difference, which is not what the Government's update states. British Marine is extremely concerned about the confusion being created and the impact these delays will have on member businesses.

British Marine will provide further updates in due course.

Update Published 21 June 2018

The EU has published its position and brought forward its counter measure action to tomorrow (22 June). Visit http://europa.eu/rapid/press-release_IP-18-4220_en.htm for more information including the confirmed list of products, their commodity codes and relevant tariffs.

The Department for International Trade have informed British Marine that all of this comes into effect at midnight tonight and its advice and guidance will be published in line with this.

Beyond the tariffs on imported recreational craft, British Marine urgently needs feedback from its membership on the other products on the list, e.g. float glass, touch screens etc. Are any of these vital to the UK leisure marine industry and its supply chain?

Yesterday (20 June) British Marine spoke with officials at the Department for International Trade’s Trade Disputes and Market Access Team and provided them with a full update on the damaging impact these tariffs will have on the UK leisure marine sector. During this engagement, DIT officials confirmed the following:

  • that the EU had decided to bring forward its action
  • this means a 25% tariff on all recreational craft imports from the US into the EU
  • there will be no product exemptions/tariff reductions at this time
  • only the EU has the power to issue these and they have no intention to do so at this time
  • there is no scope for the UK to issue exemptions or support
  • all the UK can do at the moment is
    • continue to work with the EU and hope the EU and US come to an amicable agreement
    • provide evidence to the EU of sectors that will be adversely impacted by these tariffs

It must be noted that any exemptions of tariff reductions will be product specific and not country specific.

Therefore, the focus of British Marine and its members is to continue to provide the UK Government with evidence and assist them with their engagement with the EU. British Marine is working with the US and European marine trade associations to provide collective evidence to both sides on the extremely damaging impact these tariffs will have on the industry and small businesses.

Concerning product that is already in transit ahead of tomorrow’s implementation date, British Marine understands there are two options (awaiting confirmation from the EU and UK Government on exactly how these will operate):

Subject to the provision of appropriate evidence (British Marine has asked what this would be)

  1. Manually amending the tariff rate on the electronic import system – subject to evidence of proof of shipping
  2. Retrospective claims to HMRC
    • As previously mentioned, British Marine highlighted that this would be exceptionally time consuming and act as a further burden on the industry

British Marine's conversations with UK officials are ongoing and updates of information are being provided on a constant basis. British Marine will endeavour to update its members as quickly as possible, direct to those who have been in contact, via its website and the Latest News email. Please keep an eye on the British Marine website and rel="noopener noreferrer" https://www.gov.uk/government/announcements for further announcements/updates.

British Marine requests that members continue to email Andrew Harries at aharries@britishmarine.co.uk with as much evidence as is available on the damaging impact of these tariffs on the UK’s leisure marine industry. British Marine has already provided a lot to Government, but it is vital this flow of evidence is maintained.

Published 13 June 2018

British Marine would like to make members aware that, currently, the EU intends to raise tariffs on a range of marine product imports from the US. These tariff increases (up to 25%) are expected to come into force on 1 July 2018. As well as providing an update, British Marine is asking members for some urgent information to assist it with its representations on this matter.

Members will be aware of the fact that President Trump has raised tariffs on steel and aluminium imports into the US (citing national security concerns under the World Trade Organisation (WTO) rules) from a number of countries and trading bodies, which includes the EU. Until recently, the EU (along with Canada and Mexico) had been given an exemption to the tariff increases, while negotiations continued, but that recently came to an end.

In response, the EU has been working on a list of counter measures, which will see significant tariff increases on imports of a wide range of products. These counter measures include pleasure craft, specifically (this is based on a list published by the EU in March):

89039110 Sea-going sailboats and yachts, with or without auxiliary motor, for pleasure or sports
89039190 Sailboats and yachts, with or without auxiliary motor, for pleasure or sports (excl. seagoing vessels)
89039210 Sea-going motor boats and motor yachts, for pleasure or sports (other than outboard motor boats)
89039291 Motor boats for pleasure or sports, of a length <=7,5 m (other than outboard motor boats)
89039299 Motor boats for pleasure or sports, of a length >7,5 m (other than outboard motor boats and excl. seagoing motor boats)
89039910 Vessels for pleasure or sports, rowing boats and canoes, of a weight <=100 kg each
89039991 Vessels for pleasure or sports, rowing boats and canoes, of a weight >100 kg, of a length <=7,5 m
89039999 Vessels for pleasure or sports, rowing boats and canoes, of a weight >100 kg, of a length >7,5 m

(The latter three commodity codes exclude motor boats and motor yachts powered other than by outboard motors, sailboats and yachts with or without auxiliary motor and inflatable boats)

The full confirmed list has not been released by the EU yet, but there are numerous reports in the trade and national press about what else will be included - e.g. Harley Davidson motorbikes, Levi jeans, Florida orange juice).

British Marine has been working with the UK Departments for Business and International Trade to try and obtain some form of exemption for marine products from the EU's retaliatory list, but these efforts have proved unsuccessful. Therefore, British Marine's activity has turned to ensuring that its members, which are set to be affected by these tariff increases, are as informed on the situation as possible and to ensure that the UK Government has suitable support measures in place for those UK companies affected.

Next week (w/c 18 June) representatives from British Marine will be meeting with Ministers from the above-mentioned Departments to discuss the membership's concerns.

The key questions which British Marine is asking are:

  • What Government support is available to UK companies affected by the EU’s counter measures?
  • When will the list of counter measures be confirmed by the EU?
  • Confirmation of when the tariff increases take affect from?
  • How long are these tariff measures expected to last?
  • How will goods that are already in transit from the US, but are not due into the UK until after 1 July, be affected?
    • British Marine understands that goods already in transit before the implementation date will be not be subject to the increased rate, however it remains unclear how this will be handled. British Marine is seeking an urgent position on this, with a system in place that puts as little burden on trade as possible

The information British Marine has received so far from the UK Government is that the EU Commission has not formally announced the counter measures, but that is expected either later this week or next week. However, it is unlikely that any changes will be made to the draft list as it currently stands, which means that marine products will remain and be subject to increased tariffs. The counter measures are expected to last indefinitely, until and unless something happens to change the situation. British Marine is waiting on a response from the Department of International Trade (DIT) on whether the counter measures will apply to goods already dispatched before 1 July 2018. 

British Marine is working closely with a host of national and international partners, including ICOMIA (the International Council of Marine Industry Associations) and the NMMA (the US marine industry trade body) to try and bring about a successful end to this situation. Activities being undertaken include letters being sent direct to President Trump and the EU Commission, highlighting the exceptionally damaging impact these tariff increases will have on the UK, EU and US marine industries. In particular, British Marine is very concerned about the potential impact on micro and small businesses in the UK marine industry - some 83% of marine businesses in the UK are micro and small in size.

To this end, British Marine needs to hear from any members which import any of the above-mentioned products from the US. Specifically, British Marine needs to know how many UK companies are significantly reliant on US imported pleasure vessels, the US brands being imported and how many employees those member companies have.

British Marine members should send this information to Andrew Harries at aharries@britishmarine.co.uk. Members with any questions may also contact Andrew. British Marine will publish updates whenever they become available and British Marine members are advised to keep an eye on the British Marine website for further information.